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A new national study has found that the more money parents pay for their kids’ college educations, the worse their kids tend to perform, at least when it comes to grades. According to “More Is More or More is Less? Parent Financial Investments During College,” a paper by Laura Hamilton, a sociology professor at University of California, Merced, larger contributions from parents are linked to lower grades among students at a variety of four-year colleges.

The study’s results are striking because most parents assume that the more money they pay for their children’s education, the better their children will perform. If students don’t have to spend time working a job to support themselves, goes the thinking, and they aren’t burdened by the weight of heavy loans, they will be free to study more diligently.

But it turns out that students whose educational costs are paid for entirely by their parents, engage in more leisure activities. In other words, they party instead of study. Most students don’t party so hard that they flunk out of college, but they do damage to their academic performance.

Hamilton found less of an impact on grades at more elite colleges than at other private out-of-state schools. And despite their lower grades, the graduation rate for students whose parents paid their full freight was higher than for those whose parents didn’t. That’s not surprising, since many students leave college for financial reasons.

For students from the most affluent families, the hit to their GPAs don’t make much difference in the long run, says Hamilton, because after graduation, their parents’ connections help them get a job. But students from middle or low-income families, whose parents work hard to find the money to send them to college, often have a tough time post-college because they don’t have the parental connections that will get them jobs and their parents can’t afford to support them once they graduate.

Hamilton got interested in doing the study, which is published in the January issue of the American Sociological Review, after spending a year living in a women’s college dorm with a colleague, Elizabeth A. Armstrong, a sociology professor at the University of Michigan. They followed students through graduation and interviewed their parents. “I noticed there were a lot of parents who had to scrimp and save and pull money from all sorts of sources, and they were not getting the results they expected,” says Hamilton. “I wanted to know if this was a fluke in our data or if this was a phenomenon that was happening nationally.”

After scrutinizing three federal data sets, including the Baccalaureate and Beyond study, the Beginning Postsecondary Students study and the National Postsecondary Student Aid Study, and comparing parental contributions and grades while controlling for parental socioeconomic status, Hamilton’s thesis about parents’ funding and low grades proved correct.

Hamilton and Armstrong have also written an upcoming book, called Paying for the Party: How College Maintains Inequality, where they expand on their dorm experience and describe how cuts in state funding of higher education have resulted in state schools relying on more tuition dollars. These schools are not elite schools, but neither are they inexpensive, so they wind up attracting families who can afford to pay. “The people who can pay money at four-year public universities are going to be socially oriented,” she says. In other words, more expensive schools attract students who want to party. Hamilton says that more academically oriented students go to elite colleges like Harvard, Yale or Wesleyan

What should parents do? “It’s not that all money is bad,” says Hamilton. “The problem is how the money is given.” Parents should have a careful discussion with their children about the costs of college and what kind of performance they expect. “Make it clear that this is their job,” she says. “Say, ‘I’m going to give you this money to purchase art supplies for this class you want to take. I’m not going to fund your trip to Cabo San Lucas for Spring break.’” Hamilton also recommends that students be required to get a part-time job or work-study position of up to ten hours a week. “That may change the tenor of what they’re doing at school,” she says.